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Some thoughts on the value added from a new round of climate change damage estimates

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  • Gary Yohe
  • Chris Hope

Abstract

This paper offers some thoughts on the value added of new economic estimates of climate change damages. We begin with a warning to beware of analyses that are so narrow that they miss a good deal of the important economic ramifications of the full suite of manifestations of climate change. Our second set of comments focuses attention on one of the most visible products of integrated assessment modeling—estimates of the social cost of carbon which we take as one example of aggregate economic indicators that have been designed to summarize climate risk in policy deliberations. Our point is that these estimates are so sensitive to a wide range of parameters that improved understanding of economic damages across many (if not all) climate sensitive sectors may offer only limited value added. Having cast some doubt on the ability of improved estimates of economic damages to increase the value of economic damage estimates in integrated assessment modeling designed to inform climate policy deliberations, we offer an alternative approach—describing implicitly a research agenda that could (a) effectively inform mitigation decisions while, at the same time, (b) providing economic estimates for aggregate indicators like the social cost of carbon. Copyright Springer Science+Business Media B.V. 2013

Suggested Citation

  • Gary Yohe & Chris Hope, 2013. "Some thoughts on the value added from a new round of climate change damage estimates," Climatic Change, Springer, vol. 117(3), pages 451-465, April.
    • Handle: RePEc:spr:climat:v:117:y:2013:i:3:p:451-465
    DOI: 10.1007/s10584-012-0563-9
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    References listed on IDEAS

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    1. Mendelsohn, Robert & Emanuel, Kerry & Chonabayashi, Shun, 2011. "The impact of climate change on global tropical storm damages," Policy Research Working Paper Series 5562, The World Bank.
    2. Alex Marten & Robert Kopp & Kate Shouse & Charles Griffiths & Elke Hodson & Elizabeth Kopits & Bryan Mignone & Chris Moore & Steve Newbold & Stephanie Waldhoff & Ann Wolverton, 2013. "Improving the assessment and valuation of climate change impacts for policy and regulatory analysis," Climatic Change, Springer, vol. 117(3), pages 433-438, April.
    3. Paul Kirshen & Chris Watson & Ellen Douglas & Allen Gontz & Jawon Lee & Yong Tian, 2008. "Coastal flooding in the Northeastern United States due to climate change," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 13(5), pages 437-451, June.
    4. Harold Hotelling, 1931. "The Economics of Exhaustible Resources," Journal of Political Economy, University of Chicago Press, vol. 39(2), pages 137-137.
    5. Seiritsu Ogura & Gary Yohe, 1977. "The Complementarity of Public and Private Capital and the Optimal Rate of Return to Government Investment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 91(4), pages 651-662.
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    Cited by:

    1. Newbold, Stephen C. & Marten, Alex L., 2014. "The value of information for integrated assessment models of climate change," Journal of Environmental Economics and Management, Elsevier, vol. 68(1), pages 111-123.

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